ReneSola Ltd. (SOL) signed two wafer supply agreements to provide two major Taiwanese solar companies (Neo Solar Power Corporation and Solartech Energy Corporation) with approximately 836 MW of monocrystalline and multicrystalline solar wafers. ReneSola sells solar wafers to a global customer base of solar cell and module manufacturers. Taiwan continues to be a major market for the company. It generated 13.1% of its 2009 sales from Taiwan, next only to its largest market, China.
ReneSola will supply Neo Solar Power with approximately 293 MW of multicrystalline wafers from July 2010 to December 2013 and approximately 141 MW of monocrystalline wafers from October 2010 to December 2013. The company will also supply Solartech Energy with approximately 402 MW of multicrystalline wafers from July 2010 to December 2013.
ReneSola, based in China, is a leading global manufacturer of solar wafers and producer of solar power products. Capitalizing on proprietary technologies, economies of scale, low-cost production capabilities and technological innovations and know-how, ReneSola leverages its in-house virgin polysilicon and solar cell and module production capabilities to provide its customers with high-quality, cost-competitive solar wafer products and original equipment manufacturing services.
ReneSola is committed to becoming the industry leader as a cost-competitive producer of wafer products, capitalizing on its advanced manufacturing and technology-driven platform to consistently reduce cost. The company expects wafer costs to reduce to a range of $0.46 per watt to $0.48 per watt by the end of 2011.
ReneSola for fiscal 2010 expects revenues in the range of $1.0 billion–$1.05 billion and gross profit margin in the range of 25%–27%. For the second half of fiscal 2010, gross profit margin is expected in the range of 28% – 30%. The company for the third quarter of 2010 expects total solar product shipments in the range of 280 MW–310 MW and revenues in the range of $300 million–$320 million.
By fiscal 2011 ReneSola plans to expand its wafer production capacity to 1.8 GW from the current annual capacity 1.2 GW, while expanding module production capacities to 600 MW from the current 375 MW.
The fortunes of ReneSola look greener with a geographically-diversified customer base, ongoing expansion programs, subsidy programs, improving operating efficiencies, rising margins and material cost savings through its vertically-integrated production structure.
The Zacks #1 Rank (Strong Buy) stock, we feel, would present a small window of opportunity for investors in the near term (1 to 3 months) compared to its Zacks #3 Rank (Hold) peers like Canadian Solar Inc. (CSIQ), Evergreen Solar Inc. (ESLR) and First Solar Inc. (FSLR).
CANADIAN SOLAR (CSIQ): Free Stock Analysis Report
EVERGREEN SOLAR (ESLR): Free Stock Analysis Report
FIRST SOLAR INC (FSLR): Free Stock Analysis Report
RENESOLA LT-ADR (SOL): Free Stock Analysis Report
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